New year is approaching!
In 2021, many entrepreneurs formed LLC companies and started doing business in Usa. Many entrepreneurs, especially e-commerce, software companies, education companies, dropshipping and Amazon, earn their payments in foreign currency and transfer their money to the regions where they are located. In these difficult times, at least those who earn dollars feel financially comfortable.
Of course, today is the best time to form an llc in order not to miss opportunities when it comes to a profitable business. However, if your plans are a little more forward-looking and you are not in a hurry, you should know that the best time to form an llc in Usa is the first days of the new year.
When Should I Form an LLC Company?
Form your company as of January 1
If you are planning a new venture and you are going to form a new LLC company in Usa and earn dollars in line with this plan, it is normal for this situation to excite you. However, instead of getting excited and making an impulsive decision, it would be in your best interest to wait a little longer. Because assuming you formed your company this year, you will have some expenses before the middle of 2022. In this case, you will encounter additional expenses while trying to adapt to your new job.
If you take your time and form your company on or after January 1, your additional expenses will be postponed until 2023, which will give you a sigh of relief.
What are these additional costs?
State Fees: In some states, state filing, annual report or franchise taxes are due early in the year. Assuming that you established a company on December 25, and you established it in a state where you are required to file an annual report in the first quarter of the year, you will need to submit an annual report and pay the state fee a few months after establishing your company. If you start the company in January of the new year, you will submit your annual report one year later. This saves you an extra year of time and money.
Form 5472: As it is known, the owners of single-member foreign LLCs are exempt from federal taxes if they do not receive any income from the USA or do not have a physical connection to the USA such as an office, branch or warehouse. The only tax form that an LLC company owner that meets these conditions must fill out is a form called 5472.
You must file this form by April 15, one year after you form your company. In this case, if you form your company in 2021, you must submit the form 5471 activity report to the IRS by April 2022.
So, will you have an advantage if you form your company on January 1, 2022?
You will definitely have an advantage!
In this case, you will have approximately 16 months to fill out this 5472 form. In other words, by filling out this form in April 2023, you will submit the report of the income you earned through your company in 2022 to the IRS.
Note: It is advisable to complete this report by getting the services of a CPA by April 15 at the latest, otherwise the IRS may send penalty letters to LLC companies on this issue.
Filling out the form is not actually paying taxes, but you are simply reporting the money coming and going out of the LLC company during the year to the US revenue administration. There is no tax aspect or payment for this, you just need to pay the accountant's service fee. In short, this is a declaration for notification purposes only, not a tax declaration.
Registered Agent Fees: As it is known, Registered Agent fees are paid annually and every foreign LLC must be affiliated with an agency located in the USA. Registered Agent fees are exclusive of other items because agencies will collect your next payment at the end of 12 months, based on your first company establishment date. In summary, we can say that the installation year does not make a difference for Registered Agent.
If you formed your company in 2021, your agency will ask you to make payment at the end of 12 months and you will be reminded to make payment based on your company formment date. If you do not receive a reminder, you are free to change your Registered Agent company by moving to a different company at any time during the new year.
Forming an LLC in Usa in 2022
The process and costs of establishing a company in America are the same in 2022 as in 2021. Northwest Registered Agent, America's largest agency, will continue in 2022. Therefore, do not rush and start your company in 2021 and incur unnecessary expenses that will require payment a few months later.
If you want to benefit from the $39 + State fee discount we receive through Northwest, the address will not change in 2022. Again, by accessing the Northwest website from this link,
When you form your company as of January 1, the annual report, form 5472 and state reporting fees will be transferred to the next year and you will be able to fully focus on your business without any expenses until that time.
